Energizer has partnered with CRS a manufacturer of light-emitting-diode (LED) technology. On February 14, 2011, CRS Electronics Inc. (TSX-V:LED), an inventor, developer and manufacturer of LEDs, announced an exclusive agreement with Energizer Holdings, Inc. (NYSE:ENR).
With rapidly growing demand for energy efficient lighting, this new partnership is causing investors to take notice. Energizer says the move will help expand its portfolio, and CRS stock surged 46.94 percent on Monday.
According to a 2011 report from Pike Research, energy-efficient technologies are expected to make up over 75 percent of the US lighting market by 2020. Strategies Unlimited has predicted growth of 28 percent in the LED lighting market from 2008 to 2012. The LED market was forecasted to exceed $5 billion in 2012, corresponding to a compound annual growth rate of 28 percent between 2008 and 2012.
Energizer has a long-standing commitment to environmental preservation. They have taken steps to minimize the environmental impact of their products and their manufacturing processes. The company has led the industry in eliminating heavy metals like Mercury and Cadmium from their batteries. Energizer’s packaging is 100% recyclable, and they have dramatically reduced ozone-depleting agents from their production process and their supply chain. The battery giant is also one of the largest supporters of the Rechargeable Battery Recycling Corporation (RBRC). Energizer continues to proactively reduce the environmental footprint of their manufacturing operations ahead of governmental mandates. In the US, the EPA modeled its battery effluent standards on Energizer’s achievements.
What makes this deal noteworthy for investors is the fact that this is a partnership between two well placed complimentary players. CRS is a leader in high efficiency LEDs, the company’s main motto of is “to reduce energy while maintaining quality.” Energizer is one of the world’s largest manufacturers of primary batteries, portable battery-powered devices, and portable flashlights and lanterns. Energizer manufactures the “Ultimate Lithium,” the longest lasting battery for high-tech devices and CRS manufacturers some of the most efficient LEDs including the MR16, PAR 20, PAR 30 and PAR 38. This partnership enables Energizer to benefit from the growing LED market, while CRS gains access to the Energizer brand.
In a recent press release from CRS, Jim Olsen, Vice President of Marketing for Energizer North America, said, “CRS was selected for their commitment to excellence in LED lighting technology capabilities and their history of innovation in the LED lighting industry.”
“We are honoured to be working with the Energizer® brand name. Partnering with a premium, trusted brand validates our efforts and gives us a competitive edge in the marketplace,” said Scott Riesebosch, President, CRS Electronics. “This agreement expands our product reach from the commercial space to retail, and from one product line to four, representing a significant growth opportunity for the Company. We are thrilled with the opportunity and will continue to develop new LED products to support our relationship with Energizer.”
LED lighting is destined to play a central role in efficiency efforts because LEDs are more efficient than incandescent, halogen and compact fluorescent lights (CFLs). According to a study titled, Advanced Lighting to 2013 – Demand and Sales Forecasts, Market Share, Market Size, Market Leaders, US demand for advanced lighting is forecasted to grow 10.9 percent annually through 2013. The study predicts that CFLs and LEDs will grow the fastest. However, CFLs contain mercury and are therefore difficult to recycle.
There are other problems associated with CFLs. As reported in Popular Mechanics, CFLs do not live up to their Energy Star ratings while “LEDs have a quality of light superior to all other types of lighting—and they deliver it more efficiently.”
Around the world less efficient lights are being replaced. In the US, the growth of LEDs will be driven by 2007 legislation that banned the incandescent light bulb. This legislation is scheduled to come into effect in 2012. By 2014, all lights must use 25 to 30 percent less energy, and by 2020, lights must be 70 percent more efficient than they were in 2007.
Energizer’s new CRS LED lighting products will be well positioned to take advantage of the trend towards more efficient lighting solutions. CRS is an Energy Star and Lighting Facts partner and a well-established LED lighting supplier in North America, including providing LED replacements for halogen lights.
LED lighting will increasingly replace both incandescent and halogen lighting. LED lighting uses approximately 75 percent less energy than a halogen light bulb. LEDs can last up to 50,000 hours while halogen light bulbs last between 2,000 and 6,000 hours. LED bulbs last up to 10 times as long as CFLs and far longer than incandescents. LED lighting extends battery life 10 to 15 times longer than with incandescent bulbs. LEDs use only 2-10 watts of electricity or 1/3rd to 1/30th of the energy needed for incandescent bulbs or CFLs.
Although LEDs are more expensive than either incandescent bulbs or CFLs, the cost is recouped over time in energy savings. The cost of LEDs will also decrease as the market grows and production increases. LEDs offer great value, particularly in commercial settings where maintenance and replacement costs are expensive.
Halogen bulbs convert about 90 percent of the energy to radiant heat. While LED lighting converts only a fraction of the energy to wasted heat. By producing 3.4 btu’s/hour compared to 85 for incandescent bulbs, LEDs do not cause heat build up and this reduces energy costs associated with air conditioning.
The low power requirement for LEDs also make them ideal for use with small scale renewable power generation like solar panels.
The CRS partnership fits seamlessly with Energizer’s continuing environmental efforts. CRS LED lighting products are consistent with Energizer’s new marketing campaign that goes by the title, Now That’s Positivenergy. The campaign’s central message is power plus responsibility.
CRS manufactured LED lighting products bearing the Energizer brand will be available to commercial and retail networks in the second half of 2011. With LEDs rapidly becoming the standard, the new Energizer branded LEDs are poised for explosive growth.
© 2011, Richard Matthews. All rights reserved.
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